United Arab Emirates Company to Sell U.S. Port Interests

Dubai Ports World, the United Arab Emirates firm that bought control of six U.S. ports, said yesterday it will sell its interests in the face of congressional pressure, the Washington Post reported (see GSN, March 6).

“Because of the strong relationship between the United Arab Emirates and the United States and to preserve this relationship, DP World has decided to transfer fully the U.S. operations of P&O Ports North America, Inc. to a United States entity,” said company Chief Operating Officer Edward Bilkey. 

“This decision is based on an understanding that DP World will have time to effect the transfer in an orderly fashion and that DP World will not suffer economic loss,” he added.

The company made the announcement after Republican lawmakers told the White House that the deal would be killed in Congress because of security concerns. Among those concerns were worries that the United Arab Emirates had been complicit in the shipment of WMD components (see GSN, March 3).

President George W. Bush earlier had vowed to veto any bill opposed to the sale.

The White House yesterday reaffirmed the “strong relationship” between the United States and the United Arab Emirates.

“This decision provides a way forward and will allow us to continue working on other issues,” said White House spokesman Scott McClellan.

Analysts predicted that the two countries would be able to preserve economic and security ties but that the U.S. image in the Middle East would take a blow. Arab media have portrayed the controversy over the deal as anti-Arab, according to the Post.

“This can only make the already-damaged image worse,” said Youssef Ibrahim, managing director of the Strategic Energy Investment Group. “The problem is, for four or five years, we haven’t found a way to repair that damaged image.”

It is not yet known what company will take control of the ports.

DP World officials have said the company will no longer hold any interest in U.S. ports.

“To me, there’s nothing more to be done,” said Representative Peter King (R-N.Y.).   “The deal is over.”

David Mack, vice president of the Middle East Institute and former U.S. ambassador to the United Arab Emirates, said U.S. requests for military help from the country might now be ignored. In the past, it has responded favorably to such calls.

“They’ve been doing such things because they’ve felt they had a special relationship with us. Now, I would expect less eagerness on their part to be as accommodating,” he said (Weisman/Graham, Washington Post, March 10).

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Iraq Likely to Seek WMD Again, Ex-CIA Official Says

Despite the ouster of Iraqi President Saddam Hussein, Baghdad is likely to pursue WMD programs within the next five to 10 years, a former top CIA official said yesterday (see GSN, March 9).

Paul Pillar, who was in charge of agency assessments for the Middle East until last year, told the Middle East Institute in Washington that the CIA had warned the Bush administration prior to the U.S. invasion of the country that any future Iraqi government would likely seek weapons of mass destruction, Newsday reported today.

Iraq is in “a dangerous neighborhood,” with other regional powers pursuing nonconventional weapons, he said.

“Iraq may turn once again to ... a WMD program,” said Pillar. “And wouldn’t that be ironic?” (Timothy Phelps, Newsday, March 10).

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U.S. Financial Moves on North Korea Deemed Effective

U.S. financial regulatory actions against a Macao bank accused of laundering money for North Korea have been more effective in putting pressure on Pyongyang than anyone had expected, senior Bush administration officials told the New York Times (see GSN, March 9).

Banks around the world are now wary of dealing with North Korea, the Times reported today, and Pyongyang is protesting the action strenuously. It has been so effective that a North Korean delegation met with U.S. officials on Tuesday to try “to get their money unfrozen,” a senior official said.

“It really struck a nerve,” said the official.

Other U.S. officials said further such enforcement actions are planned and that the use of those tactics has coalesced into a strategy. They said the Justice and Treasury departments have been granted full authority to take additional legal and financial actions against Pyongyang.

One senior official characterized the new strategy as: “Squeeze them, but keep the negotiations going.”

Several administration officials said Washington had concluded that the multilateral North Korea disarmament negotiations were unlikely to succeed unless accompanied by pressure tactics. By late summer, the administration had decided “to move toward more confrontational measures,” a former senior Bush administration official said.

One senior State Department official complained that the new policy would turn the talks into a mere “surrender mechanism.”

David Asher, who was coordinator of the State Department’s working group on North Korea until last summer, said officials believed “the beauty of this approach is it is not full-bore sanctions” (Joel Brinkley, New York Times, March 10).

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Rice Calls Iran Top U.S. Challenge

U.S. Secretary of State Condoleezza Rice warned yesterday that Iran’s threat to U.S. interests in the Middle East would grow considerably should Tehran acquire nuclear weapons, Reuters reported (see GSN, March 9).

Rice said Iran was already Washington’s top challenge in the region.

“If you can take that and multiply it by several hundred, you can imagine Iran with a nuclear weapon and the threat they would then pose to that region,” she said at a congressional hearing.

“We may face no greater challenge from a single country than from Iran, whose policies are directed at developing a Middle East that would be 180 degrees different than the Middle East we would like to see developed,” she added (Reuters, March 9).

The U.N. Security Council is expected to consider a nonbinding statement next week listing Iran’s failures to meet International Atomic Energy Agency demands, the New York Times reported today.

A draft document provided to the Times indicates the council continues to hope for a negotiated settlement “that guarantees Iran’s nuclear program is for exclusively peaceful purposes.”

The draft, composed by France and the United Kingdom, calls for a report on Iran’s compliance from agency Director General Mohamed ElBaradei “within a short time frame” after the statement is adopted, the Times reported.

Diplomats are still negotiating the time frame, according to the Times (Warren Hoge, New York Times, March 10).

U.S. Ambassador to the United Nations John Bolton said yesterday that the council must deliver a statement that “gets the Iranians’ attention,” the Associated Press reported.

“We’re going to press for as vigorous a response in the council as we can get and hope that that gets the Iranians’ attention,” said Bolton. “If the Iranians do not back off from their continued aggressive pursuit of nuclear weapons, we’ll have to make a decision of what the next step will be” (Nick Wadhams, Associated Press/Yahoo!News, March 10).

European Union foreign ministers met today to discuss the issue, AP reported.

Asked whether sanctions might be imposed on Iran over its nuclear activities, EU foreign policy chief Javier Solana told the Austrian daily Der Standard that such a move was not imminent.

“We are only at the beginning. I don’t exclude sanctions, but it depends on the type of sanctions. We certainly don’t want to target the Iranian people,” he said.

French Foreign Minister Philippe Douste-Blazy urged Iran to return to “reason.”

“The hand is extended. Negotiations are possible,” said Douste-Blazy. “Iran must understand that it has no choice. It has the right to civilian nuclear energy, it does not have the right to something else” (Associated Press, March 10).

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U.S. Will Not Demand Limits on Indian Fast Breeder Reactor, Prime Minister Says

Indian Prime Minster Manmohan Singh told the Indian parliament that the United States would not demand that New Delhi place its fast-breeder nuclear reactor under international safeguards under the terms of a nuclear technology-sharing agreement between the two countries, Electricity Daily reported today (see GSN, March 9).

“We are preparing a list of 14 reactors that would be offered for safeguards, over the next eight years, between 2006 and 2014,” he said. “We do not wish to place any encumbrances on our fast breeder program, and this has been fully ensured in the separation plan.”

“India has decided to place under safeguards all future civilian thermal power reactors and civilian breeder reactors, and the government of India retains the sole right to determine such reactors as civilian. This means that India will not be constrained in any way in building future nuclear facilities, whether civilian or military, as per our national requirements,” he added (Electricity Daily, March 10).

Meanwhile, Chinese Vice Minister of Foreign Affairs Dai Bingguo is expected to meet today with Indian National Security Adviser M.K. Narayanan, the first interaction between the two countries since the nuclear sharing agreement was finalized, the Financial Times reported.

China’s reaction to the deal has been cold, according to defense experts. 

“China is pleased the deal will place restraints on India’s nuclear program but concerned at the showcasing of the new strategic partnership with Washington,” said Brahma Chellaney, defense analyst at the Centre for Policy Research.

“Anybody sitting in Beijing or Islamabad can’t miss the larger strategic ramifications of what is happening,” he added. “The Chinese can see that March 2 was not just about nuclear cooperation. It was a major geopolitical realignment.”

Shen Dingli, a professor of international relations at Fudan University, said China would not openly criticize the deal but is not pleased with the agreement.

“China would view this as something that is not good,” he said. “It challenges China’s own strategic interests in adhering to the current shape of nonproliferation and not seeing an increase in the US presence in the region.”

Dingli said China is now more likely to enter into nuclear sharing agreements with Pakistan. 

“If the U.S. can violate [the nuclear rules], then we can violate them,” he said. 

China has also offered nuclear sharing agreements to Bangladesh, according to the Times (Johnson/McGregor, Financial Times, March 10).

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Suspect Chemical Mortars Found at U.S. Army Base

Two World War II-era mortar rounds suspected of containing chemical weapons were discovered Tuesday at a U.S. Army base in Alabama, the Anniston Star reported (see GSN, March 3).

The weapons were found near Camp Sibert, which was used during World War II as a chemical weapons training site. They were delivered to nearby Anniston Army Depot, where they will be kept in a storage igloo until experts can examine them, according to an Army press release.

Chemical weapons experts from Pine Bluff Arsenal in Arkansas were sent to Anniston, and state and county officials were notified of the find.

Army spokesman Michael Abrams said the discovery is a reminder to people who live near the base to be careful if they discover stray arms.

“If anyone finds something that looks like a grenade, artillery shell, or mortar — anything explosive — it should be left alone, and the individual should call the police or sheriff,” he said (Matthew Korade, Anniston Star, March 9).

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North Korea Test-Launches Indicate Progress in Missile Development, U.S. General Says

A top U.S. military commander said yesterday that two missiles test-fired this week by North Korea were upgraded, solid-fuel versions of a short-range North Korean missile, Kyodo News Service reported today (see GSN, March 9).

Gen. Burwell Bell, commander of U.S. forces in South Korea, told the U.S. House of Representatives Armed Services Committee yesterday that the missiles represented a “quantum leap” in performance, compared with rockets Pyongyang has tested previously.

Bell said earlier this week that Pyongyang has more than 600 short-range missiles that can deliver conventional or chemical munitions anywhere on the Korean Peninsula.

He also said North Korea has up to 200 ballistic missiles with a range of 1,300 kilometers capable of reaching Japan with the same payloads, according to Kyodo (Kyodo News Service, March 10).

Bell also told the committee that Chinese-North Korean shared military exercises are rare and that there are no indications of major weapons transfers between the two allies, Yonhap News Agency reported yesterday.

Although critics have accused Beijing of not doing enough to persuade North Korea to abandon its nuclear programs, Bell said it does appear to be making efforts.

“I think at this point this represents good-faith effort to keep a lid on North Korean expansionism, proliferation etc.,” he said (Lee Dong-min, Yonhap News Agency, March 9).

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